Indian equity benchmarks dived deeper into negative territory and ended with heavy losses of over three percent on Tuesday, tracking weakness in global peers, after US crude prices nosedived below the $0 a barrel mark for the first time ever highlighting an unprecedented global oil gut. Sensex and Nifty slipped below their crucial 30,650 and 9,000 levels, respectively. Key indices made a gap-down opening as traders were cautious with report showing that investments through participatory notes (P-notes) in the domestic capital market plunged to an over 15-year low of Rs 48,006 crore at the end of March amid high volatility in broader markets on concerns over coronavirus-triggered recession. The street took a note of Eminent economist Arvind Panagariya's statement that India must now think long-term to create better paying formal sector jobs by seizing the opportunity presented by multinationals possibly moving out of China to diversify their operations in the wake of the COVID-19 pandemic. Trading sentiments remained subdued in the late trade as Fitch Solutions stating that the Reserve Bank of India (RBI) is expected to cut interest rates by 75 basis points by March 2021 as monetary easing measures till now are insufficient to lift the economy reeling under the stress of the Covid-19 pandemic.  Investors' sentiments were also pessimistic with Moody's report that the loan moratorium extended by banking regulators in countries like India and China to deal with the liquidity crunch amid COVID-19 crisis will provide temporary relief to borrowers, but will constrain banks from taking proactive recovery actions and could lead to an even greater build-up of credit losses once the moratoriums are lifted. Finally, the BSE Sensex lost 1011.29 points or 3.20% to 30,636.71, while the CNX Nifty was down by 280.40 points or 3.03% to 8,981.45.

The US markets ended lower on Tuesday, extending the pullback seen in the previous session, as high-flying technology shares gave up ground, and a historic collapse in oil prices eroded the bullish mood on markets.  A historic slump in oil prices weighed on sentiment as investors worried that plunging demand for the commodity would dent a key sector for US employment and investment and signal a deeply depressed global economy. Lingering concerns about the ongoing coronavirus pandemic also generated some negative sentiment, with President Donald Trump revealing plans to suspend immigration in the US as a result of the outbreak. On the economic data front, after reporting a significant increase in US existing home sales in the previous month, the National Association of Realtors (NAR) released a report showing existing home sales pulled back sharply in the month of March. NAR said existing home sales plunged by 8.5 percent to an annual rate of 5.27 million in March after spiking by 6.3 percent to a revised of 5.76 million in February. Street had expected existing home sales to plummet 8.1 percent to a rate of 5.30 million from the 5.77 million originally reported for the previous month.

Crude oil futures ended lower on Tuesday with the most-active June contract for the US benchmark marking its lowest finish in 21 years, a day after the May contract made history by settling in negative territory for the first time ever. Mounting worries about oversupply in the global crude market and lack of storage facilities knocked the wind out of the commodity once again. Besides, according to the International Energy Agency, demand in April is estimated to be 29 million barrels/day lower than a year ago, down to a level last seen in 1995. However, US President Donald Trump said that his administration was considering the possibility of stopping incoming Saudi Arabian crude oil shipments as a measure to support the battered domestic drilling industry. Crude oil futures for June dropped $8.86 or 43.4 percent to settle at $11.57 a barrel on the New York Mercantile Exchange. June Brent crude fell $6.24 or 24.4 percent to settle at $19.33 a barrel on London's Intercontinental Exchange.

Extending weakness for the second day, Indian rupee depreciated considerably against dollar on Tuesday, amid sharp selling seen in the domestic equity markets on the back of drop in the oil prices. Traders remained cautious a survey by industry body FICCI revealed sharpest moderation in the confidence level of India Inc since the global financial crisis of 2008-09 as the coronavirus outbreak has adversely affected their businesses. It said the Overall Business Confidence Index stood at 42.9 in the current round vis-a-vis an index value of 59.0 reported in the last survey. Strengthening of the greenback overseas and a sharp rise in coronavirus cases in the country also affected the rupee sentiment. On the global front, U.S. dollar rose on Tuesday against most major currencies as investors sought a safe haven after a plunge in oil prices a day earlier. Finally, the rupee ended at 76.83, 30 paise weaker from its previous close of 76.53 on Monday.

The FIIs as per Tuesday's data were net buyers in both equity and debt segments. In equity segment, the gross buying was of Rs 5809.18 crore against gross selling of Rs 5716.16 crore, while in the debt segment, the gross purchase was of Rs 2712.59 crore with gross sales of Rs 1170.74 crore. Besides, in the hybrid segment, the gross buying was of Rs 28.47 crore against gross selling of Rs 16.06 crore.

The US markets settled in red on Tuesday amid continued concerns about yesterday's historic nosedive by crude oil prices weighed on Wall Street. Asian markets are trading mostly lower on Wednesday on the back of sharp losses in the oil markets overnight. Indian markets ended sharply lower on Tuesday, mirroring weak global markets after a historic plunge in oil prices underscored deep economic ructions from the coronavirus pandemic. Today, the markets are likely to extend previous session's losses with negative start amid weakness in the global markets. Traders will be concerned with a survey by FICCI-Dhruva showing that as many as 72 percent of businesses surveyed as part of a report said they expect to see a high or very high impact from the coronavirus pandemic and the steps taken to counter it. Also, ASSOCHAM-Primus Partners' joint survey showed that economic stress on the industry arising out of the nationwide lockdown forced by the Covid-19 health emergency is expected to last well beyond one quarter. There will be some cautiousness with Moody's report that the loan moratorium extended by regulators in countries like India and China to deal with the liquidity crunch amid COVID-19 crisis will provide temporary relief to borrowers, but will constrain banks from taking proactive recovery actions and could lead to an even greater build-up of credit losses once the moratoriums are lifted. Though , some support may come later in the day as the government advised banks to extend the interest subversion (IS) and prompt repayment incentive (PRI) benefit to all the farmers whose accounts become due during March 1 to May 31 period.   Traders may take note of report that the Reserve Bank of India (RBI) has increased the short-term borrowing capacity of the central government by over 65% to temper market fears that excessive borrowing by the government to fight Covid-19 could put pressure on interest rates. Aviation stocks will be in focus with report that the International Air Transport Association (IATA) said domestic air traffic is down 70% globally and the recovery over the coming six months is likely to be slow due to the damage coronavirus has done to economic conditions. There will be some reaction in gold related stocks with ICRA's report stating that the widened outbreak of coronavirus (COVID-19) and the subsequent lockdown ahead of the critical Akshaya Tritiya season is a credit negative for the gold jewellery retail industry in the short-term. There will be some result announcements to keep the markets in action.   

Support and Resistance: NSE (Nifty) and BSE (Sensex)

Nifty Top volumes

• Tata Consultancy Services and Amway have entered into a strategic partnership to transform the latter's global technology operations. 
• L&T has issued and allotted 12,500 7.20% Rated Listed Unsecured Redeemable NCDs of Rs 10 lakh each aggregating to Rs 1250 crore which will mature on April 20, 2023.
• Coal India has increased the minimum assured commitment level of coal supply the trigger level to its power sector consumers from the existing 75 per cent to 80 per cent. 
• Cipla has set up Rs 25 crore Caring for Life COVID-19 dedicated Fund to support the Indian Government's efforts to effectively combat the COVID-19 pandemic.